Weekend Update, June 3rd, 2024
Index, Sector & Asset Performance
Equity markets fell last week with some poor earnings mixed in with ok to weaker economic data. The S&P 500 fell -0.5%, with technology and industrials down on the week. Energy and utility stocks outperformed in the week as a late week rally in real interest rates buoyed those sectors. Interest rates were mixed last week with a steepening bias, as the 2-year rallied -7 bps, while the 10-year yield rose 3 bps. While the S&P 500 ended last week down it finished the month of May up +4.8%, its largest one-month gain since February.
Global sector performance for the week and YTD (per Goldman Sachs Research):
Economic Indicators and Earnings Commentary
Software stocks led last week’s declines as Salesforce reported in-line revenue and earnings numbers for the quarter, but they guided down for the remainder of the year on slower corporate seat growth and delayed project spending as companies evaluate AI technology.
There continue to be signs U.S. growth is slowing particularly at the consumer level. US GDP was revised down to 1.3% annualized in the first quarter. This is below consensus expectations, reflecting a downward revision to consumer spending offset by upward revisions to housing and capex categories.
Global Market Trends/Commodities/Currencies
Oil prices rose early last week on investors’ expectations that OPEC would maintain cuts at its weekend meeting. Ultimately, WTI and Brent crude oils finished last week slightly lower at $76.99 and $81.62/bbl, respectively. This was the worst month in oil prices for the year. This morning, oil prices are down almost -3.5% as OPEC decided this weekend to loosen their restrictions on adherence to their own volume limits.
Gold prices declined last week, ending at $2345.80 troy oz.
The US dollar fell last week as the second estimate of first quarter US GDP showed slower growth than the first estimate indicated. The US dollar index ended last week –0.04% lower.
Oak Harvest Weekly Stock Talk – 2024: A Year of Storms and Volatility?
